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Before the dynasty of Mengwi kingdom exist, the area of Lake Beratan until Mount Pengelengan was ordered by the leader of Puri Marga, it makes the history of Pura Ulun Danu Beratan can not be released from the influence of Puri Marga. The history of Pura Ulun Danu Beratan has been written in “Babad Mengwi” as described below
There was a leader of Kapal Village named “I Gusti Agung Putu”. During his leadership in Kapal Village, the situation was become critical with the rebellion of “I Gusti Ngurah Batu Tumpeng” who oppose the leadership of I Gusti Agung Putu. A massive war happened between their armies and I Gusti Agung Putu was defeated on the war. As a result, I Gusti Agung Putu was brought to “I Gusti Ngurah Tabanan” (the King of Tabanan) as a hostage. One of the king’s underling named “I Gusti Bebalang” was feeling touched by the hostage’s appearance and asked to the king if he could bring that hostage to Marga as a subordinate.
Few months after he is being treated in Marga, Gusti Agung Putu showed changes in his daily appearance that make Gusti Bebalang so glad to see that changes. But, deep inside his heart, I Gusti Agung Putu still having the vengeance to I Gusti Ngurah Batu Tumpeng who was defeating him on the massive war. He then meditated at Mount Pengelengan to pray to Sang Hyang Widhi for a way to defeat his enemy I Gusti Ngurah Batu Tumpeng.

One night, Sang Hyang Widhi listen to the pray and meditation and bless I Gusti Agung Putu to defeat his enemy. He then moved to Marga and ask to Gusti Bebalang if he can have his own armies. Gusti Bebalang give him the army that he asked for and he moved to a place called “Bala Ayu” that become the place called BELAYU today.
The revenge day has come, I Gusti Agung Putu fought bravely and defeated I Gusti Ngurah Batu Tumpeng and also helping the King of Tabanan to defeat his enemies. As his gratefulness, the King give the area of Marga that used to be under Tabanan’s territory to Mengwi and the kingdom of Mengwi began to exist. To fulfill his vow, in caka year 1555 I Gusti Ngurah Agung Putu built the Pura Ulun Danu Beratan beside the Lake Beratan and has become the place to worship the Sang Hyang Widhi up until today.